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Wood pellets used as a renewable energy source in countries such as Japan and South Korea are threatening tropical forests and Indigenous communities, a new report has found.
The new spatial analysis conducted by Earth Insight with the Indonesian environmental NGO Auriga Nusantara and Indonesian Indigenous group AMAN has linked new deforestation in the world’s third largest rainforest to biomass haul zones from Indonesia's wood pellet and wood chip industry.
According to a statement by Earth Insight, the analysis revealed increased deforestation linked to biomass haul zones from Indonesia's wood pellet and wood chip industry. The action is adding pressure on tropical forests, Key Biodiversity Areas, and Indigenous territories, including the customary forest of the Polahi, an Indigenous people living in voluntary isolation in Gorontalo, Sulawesi.
The report is a follow-up of the 2024 analysis, where the scale of deforestation driven by wood-to-energy demand from Japan and South Korea was first recorded. Two years later, the new findings show the accelerating threat of Japan’s record-breaking wood pellet imports to Indigenous Territories, intact forests, and rainforest species found nowhere else on Earth.
“Despite clear evidence that wood pellets are sourced from Indonesia’s rainforests. Japan imports continue to grow: According to the Indonesian Ministry of Environment and Forestry (MoEF), in 2025, Japan accounted for nearly 75 per cent of Indonesia’s wood pellet exports,” it said.
The new findings document wider Indigenous territorial overlap across Indonesia covering 347 Indigenous territories, across more than 4.3 million hectares in Indonesia that now stand threatened by chip mill haul zones.
It noted that forests and biodiversity areas are at risk. More than 11 million hectares of total forest cover now sits within the haul zones of Indonesia's chip mills, including more than 6.9 million hectares of undisturbed forest.
“Within these zones, 43 Key Biodiversity Areas — totalling more than 2.8 million hectares — are at risk,” it noted.
The findings also point out that the chip mill haul zones threaten critically endangered orangutan habitat overlapping three million hectares of orangutan habitat, threatening the Sumatran, Tapanuli, and Bornean species.
Sulawesi island is the habitat of 17 endemic primate species. Gorontalo’s forest ecosystems provide habitat and connectivity for such endemic species as the anoa buffalo, the North Sulawesi babirusa (known as “prehistoric deer-pigs”), hornbills, macaques, and tarsiers, it stated.
These forests are connected to the broader Nantu-Boliyohuto reserve — one of Sulawesi’s significant remaining stronghold for wildlife endemic to the region.
Direct concessions fragment wildlife populations, disrupt ecological connectivity and disrupt biological richness making Gorontalo a globally important centre of endemism.
“The Polahi people are found within the eastern concessions linked to PT Gorontalo Panel Lestari's wood pellet facility, an area including more than 24,500 hectares of tropical moist forest. Expanded wood pellet and industrial sourcing will further endanger the Polahi Indigenous Peoples living in voluntary isolation and initial contact who depend on intact forests and ecosystems for survival,” it added.
The forests located in Gorontalo province on Sulawesi island are the main wood pellet export hubs to Japan, the analysis noted with Gorontalo alone contributing over 94 per cent of Indonesia’s wood pellets exports to Japan and South Korea. Out of these 80 per cent come from natural forests.
“The Polahi people live within concessions linked to the wood pellet facility in Gorontalo, in an area with more than 24,500 hectares of tropical moist forest. So far, 21 per cent, or 7,800 ha, of this area have been deforested. The only way to ensure their cultural survival in this region is to keep the remaining more than 24,000 hectares of forests intact,” the statement said.
Recent spatial analysis shows accelerating deforestation in forest concessions that supply wood to the PT Gorontalo Panel Lestari Wood Pellet facility, it said.
Heavy deforestation is impacting the indigenous communities. Across Indonesia, forest concessions granted for wood bioenergy overlap with residential areas in 347 Indigenous territories covering more than 4.3 million hectares of some of the most biodiverse forests on Earth, the analysis found.
The statement said that the large scale overlap demonstrates how export of foreign wood pellets risks bicultural landscapes crucial to biodiversity, carbon stocks and ecosystem stability.
“In the last ten years, industrial expansion has taken more than 11.7 million hectares of Indigenous territories, an area larger than South Korea,” it said.
The authors of the analysis said that the findings reveal that wood bioenergy is a false climate solution and the assumption that forest biomass is a renewable energy source is based on carbon rules that hide full emissions. “In fact, biomass power plants emit 50 per cent–60 per cent more CO2 per megawatt-hour than modern coal plants,” they said.
Five years ago, more than 500 scientists and economists warned that climate policies treating biomass as a carbon-neutral energy source "create a model that encourages tropical countries to cut more of their forests", a warning the report said is now being borne out in Indonesia.
Earth Insight has called for the threat posed by the international trade in wood pellets to be included in International Union for Conservation of Nature species assessments and Convention on International Trade in Endangered Species regulations.
They also called for bioenergy CO₂ emissions to be reported and accounted for in the same way as fossil fuel emissions, for biomass to be excluded from subsidies, and for governments to fund low-emission alternatives.
